The calculations below outline how an intrinsic value for
Dassault Systèmes
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

The current share price of
Dassault Systèmes
is above its future cash flow value.

Often investors are willing to pay a
premium
for a company that has a high dividend or the potential for future growth.

PRICE RELATIVE TO MARKET

We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for
Dassault Systèmes's
earnings,
growth
and
assets
is considered below, and whether this is a fair price.

Price based on past earnings

Are
Dassault Systèmes's earnings available for a low price, and how does
this compare to other companies in the same industry?

High Growth Checks

Dassault Systèmes's earnings are expected to grow by 14.5% yearly, however this is not considered high growth (20% yearly).

Dassault Systèmes's revenue is expected to grow by 8.9% yearly, however this is not considered high growth (20% yearly).

Past and Future Earnings per Share

The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.

Past performance checks

We assess
Dassault Systèmes's performance over the past 5 years by checking for:

Has earnings increased in past 5 years? (1 check)

Has the earnings growth in the last year exceeded that of the
Software
industry? (1 check)

Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)

Is the Return on Equity (ROE) higher than 20%? (1 check)

Is the Return on Assets (ROA) above industry average? (1 check)

Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)

The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
Dassault Systèmes
has a total score of
3/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

DAST.F Health

A company's financial position is much like your own financial position,
it includes everything you own
(assets)
and owe
(liabilities).

The boxes below represent the relative size of what makes up
Dassault Systèmes's finances.

The net worth of a company is the difference between its assets and liabilities.

Net Worth

Dassault Systèmes is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Dassault Systèmes's cash and other short term assets cover its long term commitments.

Balance sheet

This treemap shows a more detailed breakdown of
Dassault Systèmes's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
checks below.

Assets

Liabilities and shares

The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.

Low level of unsold assets.

Debt is covered by short term assets, assets are 4.2x debt.

Historical Debt

Nearly all companies have debt. Debt in itself isn’t
bad,
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.

DAST.F Management

Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.

CEO

BernardCharlès

COMPENSATION

€15,788,120

AGE

61

TENURE AS CEO

17.2 years

CEO Bio

Mr. Bernard S. Charlès has been the Chief Executive Officer at Dassault Systèmes SE since 2002 and has been its Vice Chairman since May 2016. He has been the Chairman & Chief Executive Officer of Exa Corporation since November 17, 2017. He served as the President of Dassault Systemes Holding Canada Inc. and Dassault Systèmes SE since September 1995. Mr. Charlès served as Director of the New Technology, Research and Development and Strategy department from 1986 to 1988 and as Director of Strategy, Research and Development from 1988 to 1995. He served as the President of Dassault Systemes K K. He served as the President of Dassault Systemes Canada Inc. He served as the Chief Executive Officer and President of Dassault Systemes Corp. and also served as the President of Dassault Systemes K.K., each of Which are subsidiaries of Dassault Systemes SE. He served as the President of Research and Development from 1988 to September 1995 and as President of Research and Strategy from 1985 to 1988. He serves as the Chairman, Chief Executive Officer and President of Dassault Systemes K.K., each of Which are subsidiaries of Dassault Systemes SE. He serves as the Chairman of Dassault Data Services, Dassault Systemes Corp., Dassault Systemes Biovia Corp., Dassault Systemes SolidWorks Corp., Dassault Systemes Simulia Corp. and Enovia Corporation. He has been the Chairman of Supervisory Board and Member of Supervisory Board at Dassault Systemes 3DExcite GmbH since March 31, 2014 and March 13, 2014 respectively. He was Chairman of the Board of Dassault Systemes Delmia Corp., Dassault Systemes Enovia Corp. (United States), Dassault Systemes Canada Software Inc. (Canada) and Chairman of the Supervisory Board of RealTime Technology AG (Germany). He served as the Chairman of Dassault Systemes K K. He has been an Independent Director of Sanofi since May 10, 2017. He served as Lead Independent Director and Director of SAP Business Objects SA since 1998. He has been a Director of Dassault Systèmes SE since April 8, 1993. He serves as a Director of Dassault Systèmes Delmia Corp., Dassault Systemes Corp., Smar Team Corporation Ltd., Dassault Systèmes Provence S.A., Dassault Systemes Americas Corp., Dassault Data Services S.A., Dassault Systèmes of America Corp., Dassault Systèmes Corp., Dassault Systèmes K.K., DELMIA Corp., Enovia Corp., Solidworks Corp., SmarTeam Corporation Ltd. and Invention Machine Corp. He serves as a Representative Director of Dassault Systemes K K. Mr. Charlès is a Certified Public Accountant. Mr. Charlès Graduated in Automation and Computer Science Engineering from The prestigious Ecole Normale Supérieure in Cachan, France.

CEO Compensation

Bernard's compensation has increased by more than 20% in the past year.

Bernard's remuneration is higher than average for companies of similar size in United States of America.

Management Team Tenure

Average tenure and age of the
Dassault Systèmes
management team in years:

12.3

Average Tenure

61

Average Age

The average tenure for the Dassault Systèmes management team is over 5 years, this suggests they are a seasoned and experienced team.

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